Strong-Arm Tactics Revive Yahoo Deal and Regulatory Concern
On the day Microsoft announced its plan to acquire Yahoo back in February, I posted my doubts that Microhoo would be established within a year, which was then the media and company line.
While supporting Carl Icahn’s proxy fight and pressuring Yahoo’s board may get a Yahoo deal on the table, this will also underscore the anti-competitive concerns of regulators in both markets. The EU is still phobic about Microsoft’s domination of the desktop, and US courts are still supervising the firm for anti-competitive activities.
Yahoo’s sounds of capitulation moved its market valuation by about 12% yesterday, even without a specific proposal on the table. However, the street would be wise to price in the increased risk and delay of regulatory approval, which based on these week’s strong-arm tactics is likely to further increase.
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